UPDATE 1-BofA-Merrill upgrades US semiconductor sector, Intel

July 7 (Reuters) - Banc of America Securities-Merrill Lynch upgraded the U.S. semiconductor industry and five stocks in the sector, including Intel Corp (INTC.O), saying recent macro data suggested definitive signs of a turn in end demand had begun to emerge, warranting a more constructive stance on the group.

The brokerage said it had previously stayed more selective in its stock ratings given lack of conviction around the demand picture.

"Indications of improved global GDP growth, and a definitive inflection in the 3-month moving average of the computers and electronic component ofUS durable goods shipments, bode well for electronic demand growth," the brokerage said in a note to clients.

Sector fundamentals will continue to benefit from a benign supply chain inventory backdrop, it said, adding that inventories were still below equilibrium levels and poised to head higher.

"Q3, thus, represents a window ofopportunity for continued ownership of the group," BofA-Merrill said.

Its industry model suggests 21 percent growth for the sector compared to 14 percent earlier.

The brokerage upgraded Intel and Marvell Technology Group Ltd (MRVL.O) to "buy" from "neutral" and LSI Corp (LSI.N) to "buy" from "underperform."

Maxim Integrated Products Inc (MXIM.O) and National Semiconductor Corp (NSM.N) were upgraded to "neutral" from "underperform."

Shares of Intel were up almost 2 percent in premarket trading, after closing at $16.54 Monday on Nasdaq. (Reporting by Saqib Iqbal Ahmed in Bangalore; Editing by )